President Emmerson Mnangagwa has dismissed allegations that the government is mortgaging the country to the Chinese. Mnangagwa said that the projects which Zimbabwe is working on with the Chinese will pay for themselves and there is no risk of default as the money will be coming from the project itself and not from the treasury. Addressing Zimbabwe in New York, Mnangagwa said,
All that which is necessary when you get any loans or investments is that it must be structured such that capital loans or investments (are made) in projects which can refinance themselves to pay back the loans, not based on the fiscus.
The 600MW (expansion of Hwange power station) we will generate in the next 18-24 months will go into the national grid and pay for itself. Nothing will come from Finance. So I don’t see any danger where you have a project which becomes productive in terms of revenue streams to pay for itself…We have the asset (Kariba South) in Zimbabwe, and even when we finish paying the loan, the asset remains with us. So I don’t see the danger there.
More: NewZWire